Monday, August 30, 2010

Elliott Wave Update

The market ended at hitting the lower price channel so we should see a bounce tomorrow if the rally from Friday was real. Currently the market is oversold and today's down day was in light volume so there will be seller's exhaustion sooner rather than later. I covered all shorts at 1055 and hold 80% of Portfolio 1 in FXI. Portfolio 2 is now in cash.

As for the wave count, I will call this wave an X and consider it corrective until proven otherwise. If we see the high of the C wave taken out we are probably on our way to the 50 MA (which is what I am expecting), if we go down hard tomorrow and take out the 1039 low, then we're probably see a 5 Wave down to test 1010 and which I will short on a Wave 2 retracement as today's wave would be labeled a W1.

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